You wouldn't invest in shares for a one-year time frame - it's too risky.
Conversely, having all your money in cash over a 10-year period is also risky - it'll barely keep pace with inflation after tax is paid.
So, depending on your time horizon, you could have some money invested in growth assets in order to gain the potential for better returns.
Principle #2 - Different eggs in different baskets
It's risky to have all your money in one investment - all in one property or in one share.
If it does well, you could make some good returns, but what if it goes bad?
Good diversification involves having money invested across the different asset classes - some in shares, some in property, some in fixed interest and cash.
The amount you place in each sector depends on your goals and objectives and the level of risk you're prepared to take in order to achieve your desired return.
Over time you'll see that each year different asset classes perform well at different times.
Principle #3 - Take from the good and give to the bad
We believe in the importance of re-balancing your portfolio.
Let's say we've recommended you have around 30% of your money invested in Australian shares.
Over the next year Australian shares produce some great returns and now make up around 35% of your portfolio.
We'd recommend you take some of the profits, and top up the under-performing sectors - if Australian shares now make up 5% more in your portfolio, other sectors will be below the recommended allocation in your portfolio.
This is a hard thing to do when things are going well.
Maybe if Australian shares do well the next year you'll regret selling down in the previous year.
But if that sector declines in value, you'll appreciate the advice we gave and the discipline in sticking to the recommended asset allocation.
Conversely, when Australian shares have a poor year and decline, we'll suggest taking money from the better-performing sectors to add to your Australian shares.
Principle #4 - Use different investment structures
When it comes to saving for retirement, for many people superannuation is the most appropriate investment vehicle for them.
But the further away from retirement you are, the more likely it is that the super rules will change.
Perhaps the change won't be major, but we believe it's risky to make major decisions on the assumptions that the same rules that apply today will still apply in 10 years when you retire.
We suggest you diversify across different investment structures.
For retirement savings, we favour superannuation as the main vehicle, but we'd also suggest other investments such as managed funds and bank accounts.
If the rules change, you haven't committed all your eggs to the one basket.
There's a danger in focusing your wealth accumulation on one investment.
I've seen clients with one investment property and a huge mortgage struggle when they couldn't find tenants for 6 months.
I've seen clients with large share holdings in one company (from an employee share scheme) see their wealth drop by 40% in the space of a few weeks due to the decline in the share price of that one company.
Imagine you've got money invested in 5 different shares.
If one of those companies goes broke you've lost 20% of your capital.
What if it was invested across 100 companies and one went broke?
As a final example of the importance of diversification, think of this example.
Imagine you're holding a lead pencil in your hand.
Bend it and snap it - it may take a bit of effort, but it is possible.
Now, take 20 pencils and hold them together in your hands.
Bend them and try and snap them - you can't.
Most people today, don't know the difference between a digital book and an ebook.
In fact, many people think they are one and the same.
They couldn't be farther from the truth.
They are entirely different species of the same animal.
Digital books, sometimes also called electronic books or PDF books, are scanned, digital facsimiles of standard printed, published books.
You can think of them as enhanced copies of the actual hard or paperback books we have come to know and love.
When we are talking about the digital version of newer publications, they are pretty much identical to the original.
When talking about old or even ancient publication, they are much better than any original you would find on the shelf of your local library.
Since they are facsimiles of the original printing, this really increases quality and helps overcome the problems of many older books, such as yellowed pages, stains, see-through or onion skin type paper, colored paper, brown inks, etc.
These are scanned pages, not 'copied' pages, and the quality of print truly represents a better quality than the print of the original book.
The great majority of digital books come in PDF format, though Amazon offers a Kindle edition, Mobipocket offers the MOBI version, then there is the plain TEXT format, as well as many others.
Digital books are usually far less expensive than their hard or paperback counterparts, and there are hardly ever shipping costs, unless they are delivered on a CD (Compact Disk).
Ebooks are digital books too, but they were designed and written for the internet.
Many, if not most ebooks were never officially "published" at all, unless you count posting something on the internet as publishing.
Most ebooks were meant to be written quickly, with little or no expenses except for possibly distribution.
The majority are short, almost always less than 100 pages, usually under 50 pages.
Some ebooks are literally slapped together in a matter of hours.
Often they are little more than several short reports combined together.
Many ebooks are self-help books, or manuals of some kind, though there are some eBook works of history and fiction to be found if you look for them.
More often than not, they have little or no literary value, their intentions being the distribution of facts, instructions and/or ideas.
Sometimes you may come across the eBook version of a hard or soft cover book.
It will even be called the "ebook version" of whatever book.
But if you look closer, you will find that this eBook version is almost always far fewer pages than the original.
You may as well call the "ebook version" the "condensed version" of the book.
Though you will find many ebooks in PDF format, much like digital books, but many come as various generic interactive applications.
But don't let the initial attraction of interaction fool you.
Even if this sounds like high tech education at first, you will find that there is not much to the promise of interaction.
It just disguises the fact that these books are short, technically no more than a few pages, with little to no real practical, and even less academic value.
Last but not least, ebooks are often free or cheap, though you will occasionally find some specialty instruction "programs" costing hundred of dollars.
Technically, ebooks are digital books, though practically there is a big difference.
Personally, I usually prefer a digital book to its eBook cousin.
The Reverend Billy Graham when asked his thoughts on hypnosis stated that hypnosis was neither good nor bad.
Like most tools it depends on how it is used.
The Pope in 1956, the British Medical Society in 1957 and the American Medical Association in 1958 endorsed hypnosis as a complementary tool in health care.
Even with those endorsements many in our educated society (and some are physicians) still misunderstand and fear the natural nature of hypnosis.
Linking it with hocus-pocus, witchcraft and even mind control.
Would you be surprised if I told you that we all naturally go into hypnosis many times each day.
The simple act of driving to work and not remembering stopping at red lights or stop signs is a hypnotic state.
It is in that day dreamy time that hypnosis occurs.
Our thoughts during that hypnotic state truly shape our lives.
In the 1950s, the Reverend Norman Vincent Peale wrote the greatest inspirational bestseller of his time.
Over 3 million copies of his book The Power of Positive Thinking were put into print.
In it he said that, "In formulating this simple philosophy of life I found my own answers in the teachings of Jesus Christ.
He wrote his book to help you release your inner powers.
- How faith in yourself makes good things happen to you
- How to get other people to like you
- How to energize your life to give yourself the vitality and initiative needed to carry out your ambitions and hopes
- How to avoid the jitters in your daily work
- How to believe in yourself and in everything you do
- How to live a controlled relaxed life no matter how fast the pace may be